FOR SALE. Auction Date July 28, 2014 Review Details and Register at. Days Inn Lake Havasu 1700 McCulloch Blvd North Lake Havasu City, AZ 86403

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1 FOR SALE Days Inn Lake Havasu 1700 McCulloch Blvd North Lake Havasu City, AZ Auction Date July 28, 2014 Review Details and Register at An Exclusive Offering For further information please contact: Jack Carr Harry Pflueger (949) (949) Arizona License # CO Improving market, major RevPAR improvement over the past three years (19% over the T-12 months thru May) Well located in town center near London Bridge Low basis, fraction of cost to replace Owner/Operator opportunity, with attractive manager s unit Fee simple land ownership Includes vacant commercial outparcel with frontage on McCulloch Blvd.

2 INVESTMENT HIGHLIGHTS \ Maxim Hotel Brokerage, Inc. is pleased to present an exclusive listing on the 89-room Days Inn Lake Havasu, located at 1700 McCulloch Blvd North, Lake Havasu City, AZ This is an excellent opportunity for an owner/operator or regional management owner/management company to own a well-located hotel in one of Arizona s most desirable recreational markets. OVERVIEW The Days Inn is a two-story exterior-corridor limited-service hotel located along McCulloch Boulevard in Lake Havasu City. Lake Havasu City has a population of 53,000 persons and is situated on the eastern shore of Lake Havasu on the Colorado River border of California and Arizona. Please consider the following highlights: Absentee Owner/Management Currently managed by absentee ownership, an owner/operator will see areas for expense efficiencies with a more hands-on operation. Competitive Property Although an owner/operator will find room for improvement, the hotel has demonstrated the ability to capture its share of business and be competitive in the marketplace. Appealing Manager s Unit- An attractive 1,000± SF 2-bedroom manager s unit is located behind the front desk area. Condition- The hotel has been well maintained, however a renovation and PIP will be required by Days Inn franchise upon change of ownership. Growing Market Growing market with increasing population and demand generators (currently about 53,000 population). Desirable Arizona/California Border Destination Market - Lake Havasu is a very popular regional destination for California, Arizona and Nevada residents. Improving Hotel Market RevPAR for the comp set is up 19.3% in RevPAR over the trailing-12-month period through May, and has been improving over the past three 12-month periods at an accelerating pace. Fee Simple Site /Expansion Site Deal includes expansion lot or outparcel for development of a restaurant or other commercial space when demand warrants. Good Location The Days Inn is located in the center of town on McCulloch Boulevard, just a couple of blocks east of the London Bridge, near the intersection of McCulloch Blvd and Lake Havasu Avenue.

3 INVESTMENT HIGHLIGHTS \ LOW COST BASIS The sale price will represent a fraction of replacement cost. The basis in the hotel could be further reduced by realizing the value of the 0.45-acre expansion site by developing it, leasing it or selling it. MARKET PERFORMANCE The competitive market performance has been showing significant growth over the past three years, with improvements in RevPAR of 7.7%, 4.5% and 19.3%, respectively, meaning that the pace of recovery is improving as well (based on the May STAR report). It should be noted that market performance in 2013 exceeded the high watermark level seen in The Days Inn currently underachieves the market, with a 95.7% RevPAR Index, but this is well below what the property achieved in past years of 116% to 118%. The decline is attributed to property condition, which demonstrates upside to improve position following a renovation. VALUE ENHANCEMENT OPPORTUNITIES Complete a renovation of the guestrooms to improve the hotel s positioning within the market. An owner/operator with a hands-on approach should be able to drive revenues and control expenses in an improving market. Develop, lease or sell the vacant outparcel. Increase and grow the ASU freshman housing extended stay program. ASU FRESHMAN HOUSING PROGRAM Growth in the Arizona State University (ASU) -Lake Havasu City business should continue with a positive impact for the Days Inn. ASU students stay in specially designated rooms in Building 2 for $37.17 per night (double occupancy) beginning in August of Currently there are two rooms in this program, but the university just added four majors, including Business and Political Science, and the additions have led to increased applications to the program for fall of ASU has hired a recruiter for this coming school year and this has led to a significant increase in applications as well. The property anticipates 15 rooms for this program starting in fall. As of July, there are a total of 11 rooms in the program. Considering the income per-semester per-room of $5,092, and assuming 12 rooms in the program (2 semesters/year), this will generate additional revenue of up to $150,000 over the next year, and should continue to grow. It is worth noting that flow-through is high since there is no daily or weekly housekeeping and no free continental breakfast.

4 PROPERTY OVERVIEW SUMMARY OF FACILITIES Address 1700 McCulloch Blvd North Lake Havasu City, AZ Guestrooms 89 Food & Beverage None Meeting Facilities One 800-SF lounge, only accessible by long-term ASU tenants Other Amenities and Outdoor swimming pool, hot tub, free Facilities wifi, business center, guest laundry, gift shop Building Area 32,770 SF Construction Commercial Laundry Guest Laundry Phone System Front Desk PMS Leases Foundation Concrete Slab Ext Walls Wood frame covered with stucco Roof - Flat, w built up composition One commercial washer, one residential washer, and two commercial dryers (Heubsch, Unimac) Two washers and two dryers, local owner pays hotel commission, month-to-month MITEL XS-50 WynGuest Version by Wyndham None Number of Stories Hotel Site Assessor s Parcel Number Ownership Interest 2, exterior corridors 1.58 acre hotel site 0.45 acre expansion parcel A B Fee simple Year Built 1973 and 1975 Zoning Parking HVAC Windows C1 72± spaces plus overflow on vacant parcel Guestrooms PTAC units; Public areas heated and cooled by two PTAC units. Single pane glass

5 PROPERTY OVERVIEW

6 SUMMARY FINANCIAL ANALYSIS HISTORICAL PERFORMANCE The Days Inn s financial performance is summarized in the below table. Historical Performance 2014 Forecast Trailing-12-Months (Actual thru June) Ending 6/30/ Occupancy 48.6% 42.1% 45.0% 43.09% 42.76% 45.24% 44.49% 46.03% 44.74% Average Daily Rate $62.36 $60.73 $55.94 $54.41 $56.06 $54.81 $57.12 $57.31 $60.85 RevPAR $30.31 $25.58 $25.17 $23.45 $23.97 $24.80 $25.41 $26.38 $27.22 Rooms Revenue $903,471 $831,071 $826,887 $763,704 $778,636 $805,447 $825,520 $859,397 $884,438 Total Revenue $915,380 $843,053 $835,487 $776,726 $789,156 $819,255 $835,584 $872,451 $899,566 NOI (1) $185,279 $131,769 $115,511 $94,010 $132,575 $158,567 $189,249 $190,455 $190,537 (1) NOI reflects adjustments as noted below. Notes: Revenue performance at the Days Inn for 2013 has returned to levels seen in 2007/2008, however profit is far below what it was then. An owner/ operator with hands-on expense control should be able to achieve or exceed higher profitability than what was achieved in 2007/2008. The 2014 Forecast shows growth of 20% in RevPAR for the Days Inn. This is achievable, considering the RevPAR for the market comp set is up 17.7% through May and the ASU Freshman Housing program begins in August. The market improvement is occurring at an accelerating pace. Detailed P&Ls are available for download from the Due Diligence Site. It should be noted that NOI is adjusted for Management Fee (3%), Reserves (4%) and expenses related to this owner are added back, including Accounting Fees and Legal Expenses. See earlier discussion regarding the ASU Freshman Housing Program at the hotel. This will add significant incremental revenue as the ASU program continues to grow; based on confirmed deposits as of July, this should contribute $120,000 of additional Room Revenue.